Twenty-three (23) drilling permits were issued, five wells were drilled, and one well was plugged in Arizona in 2010.

CO2 Sequestration

APS (Arizona Public Service) plugged its well near the Cholla power plant at Joseph City; the well was drilled to test the potential of sequestering CO2 in deep saline aquifers. The Cholla well did not encounter permeable and porous formations near the power plant. Additional information about the Cholla well and potential for carbon sequestration in Arizona can be found at www.azogcc.az.gov/.

Geothermal Resources

Utah-based GreenFire Energy received a $2 million grant from the U.S. Department of Energy to research CO2-based geothermal energy technology near Springerville in east-central Arizona. See GreenFire Energy's website at www.greenfireenergy.com/ for more information.

Potash Exploration

Potash exploration drill site in the Holbrook Basin: during drilling in June 2010. Photo courtesy of Frank Bain, Flagstaff.

The same site post-drilling and following remediation in October 2010. Photo courtesy of Frank Bain, Flagstaff.

Potash Green LLC drilled two stratigraphic wells at its potash project east of Petrified Forest National Park near Holbrook. The accompanying photographs show a Potash Green well being drilled and the reclaimed site after the well was plugged. HNZ Potash permitted 10 stratigraphic wells east of Petrified Forest National Park and plans to start drilling early in 2011. Southwest Exploration/Passport Potash permitted eight wells to delineate the extent and grade of potash at its potash project west of Petrified Forest National Park. Passport Potash plans to start drilling late this year or early next year. See Passport's website at www.passportpotash.com for more information.

There were 929,958 acres leased for oil and gas in Arizona as of June 30, 2010, down from the 1.319 million acres under lease at yearend 2009.

Oil and Gas Production

Production through October 2010 totaled 33,736 barrels of oil and 153 million cubic feet of gas. Oil production totaled 46,193 barrels from 16 producing wells in 2009, down from 51,575 barrels from 21 wells in 2008. Gas production in 2009 totaled 712 million cubic feet from 6 producing gas wells, up from 523 million cubic feet from 6 wells in 2008. No CO2 was produced in 2009. There was one active disposal well and 18 shut-in wells at yearend 2009 including 14 oil, 1 gas, 1 CO2, and 2 disposal wells.

Oil and Gas Conservation Commission

The Oil and Gas Conservation Commission held four regular meetings in 2010. Governor Jan Brewer appointed Robert L. Wagner to the AZOGCC to replace outgoing Commissioner Robert L. Jones. Mr. Wagner's appointment runs until January 2013. Governor Brewer reappointed Commissioner Michele P. Negley. Ms. Negley's reappointment runs until January 2014. Commissioner Negley resigned because she moved out of state in April. Governor Brewer appointed Frank Thorwald to replace Commissioner Katosha Nakai. Mr. Thorwald's appointment runs until January 2015. Links to rules and statutes and other information about oil and gas in Arizona may be found on the Commission's web page at www.azogcc.az.gov.